Bridgestone 2008 Annual Report Download

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OUR VISION
annual report 2008
operational review

Table of contents

  • Page 1
    OUR VISION annual report 2008 operational review

  • Page 2
    ... Shareholder Information The Bridgestone Group consists of the parent company and 437 consolidated subsidiaries. In this publication, Bridgestone Corporation denotes the parent company. FORWARD-LOOKING STATEMENTS: The descriptions of projections and plans that appear in this annual report are...

  • Page 3
    OUR VISION TO THE SOLID ULTIMATE GOAL The Bridgestone Group is one of the world's largest manufacturers of tires and rubber products. Since the parent company was established in 1931, the Bridgestone Group has grown in tandem with the automotive industry. 01

  • Page 4
    A FIRM STEP TOWARD OUR NO. 1 POSITION Aiming to respond appropriately to the ongoing, dramatic changes in the operating environment and to be a truly global enterprise, the Bridgestone Group will strive to become the "World's undisputed No. 1 tire and rubber company in both name and substance." 02

  • Page 5
    GLOBAL SALES TREND USD million   #SJEHFTUPOF .JDIFMJO (PPEZFBS Source: Fortune             .JDIFMJO    #SJEHFTUPOF  03

  • Page 6
    TIRES MEETING A WIDE ARRAY OF NEEDS Tires account for about 80% of the sales of the Bridgestone Group. The Group produces and markets a variety of tires, including those for passenger cars, trucks, buses, motorcycles, construction and mining vehicles, and aircraft. 04

  • Page 7
    DIVERSIFIED PRODUCTS IN A RANGE OF SETTINGS The Bridgestone Group also produces a wide range of other products for businesses and consumers. The Group's products and technologies support an extensive range of industrial and consumer activities. 05

  • Page 8
    MESSAGE TO OUR STAKEHOLDERS OUR VISION TO THE SOLID ULTIMATE GOAL Shoshi Arakawa, Chairman of the Board, CEO and President 06

  • Page 9
    ...My ultimate management goal is to establish the Bridgestone Group as the world's undisputed No. 1 tire and rubber company in both name and substance. Many regard the Bridgestone Group to be No. 1 "in name" based on objective criteria such as sales revenue or the global reach of our operations. Tires...

  • Page 10
    ...2008 to 2012. Rolling updates are a distinctive feature of MTPs at Bridgestone. Each year we flexibly add or update initiatives to take into account changes in the business environment, while holding steady the fundamental direction of the Bridgestone Group, its objectives, and the growth strategies...

  • Page 11
    ...role in strengthening our human resources. CORPORATE VALUE AND SHAREHOLDER RETURN The Company positions shareholder interests as an important management issue. Accordingly, while bolstering our management foundation, we work to improve our results and increase our corporate value. This commitment is...

  • Page 12
    PERFORMANCE FISCAL YEAR 2008 CONSOLIDATED RESULTS Due to the global economic recession, the Group faced not only declines in unit demand but also unprecedented rapid changes in the structure of demand and competition. In response to these changes in the business environment, the Group worked to ...

  • Page 13
    ... HIGHLIGHTS Bridgestone Corporation and Subsidiaries Years ended December 31, 2008, 2007, and 2006 • Net sales totaled ¥3,234.4 billion, a 5% decrease from fiscal 2007 • Operating income totaled ¥131.6 billion, down 47% • Net income amounted to ¥10.4 billion, a 92% decrease 2008 2007 2006...

  • Page 14
    SEGMENT HIGHLIGHTS Bridgestone Corporation and Subsidiaries Years ended December 31, 2008, 2007, 2006, 2005, and 2004 Business Segments TIRE BUSINESS In the tire segment, the Group worked to maximize its sales momentum by introducing appealing new products in domestic and overseas markets and ...

  • Page 15
    ....1 16.1 117.6 138.3 131.1 69.0 147.5 jAPAN 2008 2007 2006 2005 2004 2008 2007 2006 2005 2004 27 43 % Net Sales ¥ billion Operating Income /Operating Income Margin ¥ billion /% 1.5% 21.6 3.4 3.2 3.4 2.6 26.7 42.1 39.0 51.5 THE AMERICAS 2008 2007 2006 2005 2004 1,403.0 1,498.0 1,324.0 1,151...

  • Page 16
    STRATEGY BRIDGESTONE MTP2008 In formulating MTP2008, we incorporated key changes in the operating environment, especially the rising costs of raw materials and energy. We aim for optimum management of the entire group, utilizing this Mid-term Management Plan (MTP). We are driving toward the ...

  • Page 17
    ...FORMULATING MTP2008 BACKGROUND TO MTP2008 MTP2008 is an update of MTP2007 that incorporates changes in the business environment. This type of rolling update is a key feature of management planning at Bridgestone. Throughout the update process, however, our fundamental approach, direction, and goals...

  • Page 18
    ...with three fundamental management strategies. KEY STRATEGY 1: Always aim for "the higher level" and strive to be the best in the world in all of our products and services • We pursue growth in strategic tire products. - Runflat Tires, UHP Tires, Winter Tires - High-Value-Added Tires for Trucks and...

  • Page 19
    ...cars and highvalue-added tires for trucks and buses. The second category includes radial tires for large construction and mining vehicles, aircraft, and motorcycles. Runflat Tires, UHP Tires, Winter Tires We anticipate substantial growth in the markets for runflat tires, UHP (ultra-high-performance...

  • Page 20
    ... ride characteristics. The Bridgestone Group will continue to work aggressively to expand sales through the introduction of leading-edge technologies such as COOLING FIN, thereby enhancing its presence in the global market. High-Value-Added Tires for Trucks and Buses-GREATEC and Low-Profile Tires...

  • Page 21
    ... supply steel cord to the Kitakyushu Plant. As a supplier of the materials that support the differentiation of our products, the Saga Plant plays a key role in the vertical integration of our operations and the strengthening of our supply chain. The Bridgestone Group has the technical capabilities...

  • Page 22
    ...past, Bridgestone produced new radial tires for aircraft only at its Kurume Plant. However, in response to the growth in global demand, we started production of aircraft radial tires at the Tokyo Plant in August 2008. A project to increase production capacity is now under way at the Tokyo Plant. The...

  • Page 23
    ...may reduce production for OEM sales, but nonetheless we anticipate firm demand over the medium to long term. The BATTLAX BT-016 HYPERSPORT, which was launched in January 2008, was developed for large sport motorcycles, a sector that has seen growing demand in recent years. This new tire incorporates...

  • Page 24
    ... OF MTP2008 KEY STRATEGY 1 Eco-Friendly Diversified Products In diversified products operations, our eco-friendly products include EVA (Ethylene Vinyl Acetate) film for solar modules, which will have a high priority in the allocation of resources, and electronic paper, in which we will work to...

  • Page 25
    ... service operations for retread tires at locations close to customers. Bandag Retread Factory operations are handled in accordance with standards What Is Bridgestone Bandag, LLC? Bridgestone Bandag, LLC, which is the successor company to Bandag, Incorporated and is now part of the Bridgestone Group...

  • Page 26
    ... OF MTP2008 KEY STRATEGY 1 Antivibration rubber Steel cord conveyor belts set by Bridgestone, and the operations demonstrate a high level of quality control. Over the next few years, we plan to open about 20 of these bases around Japan. Moreover, we are implementing Eco Value Pack, a new proposal...

  • Page 27
    ... prominent business group in India, and is a leader in antivibration rubber for automobiles in that market, where it has a strong presence. With production and sales sites in Japan, the United States, China, and Thailand, Bridgestone supplies antivibration rubber to automakers with global operations...

  • Page 28
    ... management, which is one of Bridgestone's 22 CSR themes. In June 2008, we announced an action plan for the "MAKE CARS GREEN" campaign. This is an environmental activity that seeks to raise awareness about the need for greener motoring around the world. As a global partner of the Federation...

  • Page 29
    ... on a clear long-term strategy STRENGTHEN COMPETITIVENESS OF ENTIRE SUPPLY CHAIN (MAKE FULL USE OF GLC FUNCTIONS) To supply society with high-quality products and services, the Group is working to raise supply chain competitiveness throughout the tire business. The Global Logistics Center (GLC) was...

  • Page 30
    ... MTP2008 KEY STRATEGY 2 Synthetic rubber plant in China Carbon black plant in Mexico INTERNAL MANUFACTURING OF RAW MATERIALS (VERTICAL INTEGRATION) The Bridgestone Group is working to strengthen vertical integration, with an emphasis on the integrated and effective use of resources from upstream...

  • Page 31
    ... geographic regions-Japan, the Americas, Europe, China, Asia & Oceania, and Middle East & Africa-and two responsible for our specialty tire and diversified products operations. In addition, we have two key group-wide organizations, the Global Head Office (GHO) and the Global Management Platform (GMP...

  • Page 32
    ..., eco-friendly products and businesses will be a focus of further development initiatives. We will move ahead with a full-fledged global rollout of eco-friendly ECOPIA brand tires, including the start of sales in North America in 2009. In addition, the market for EVA film for solar modules continues...

  • Page 33
    ...in tire production, and conserving resources. Utilizing these facilities, we will actively promote the retread and "solutions business" in Japan. 4. Strengthen retail channels through vertical integration To realize high-quality sales activities, the Group is bolstering its retail networks in Europe...

  • Page 34
    MANAGEMENT SERVING SOCIETY WITH SUPERIOR QUALITY Bridgestone is strongly committed to corporate social responsibility (CSR), and the Company continually strives to enhance its corporate governance and R&D activities, ensuring that they always reflect a high level of consideration for safety and the ...

  • Page 35
    ...Bridgestone Europe NV/SA Chairman, CEO and President of Bridgestone Europe NV/SA Yukimitsu Ushio Takashi Yasukouchi NON-EXECUTIVE MEMBERS Fumihiro Yanaga Tire Production Technology; Concurrently Director, Plant Design and Coordination Division VICE PRESIDENT AND SENIOR OFFICERS Hiroshi Ishibashi...

  • Page 36
    ...PNNJUUFF policies. Bridgestone has adopted a corporate officer system to more clearly distinguish between management and operational responsibilities. This system allows the Board of Directors to $&0 $IBJSNBOPGUIF#PBSE exchange information and opinions and hold liaison meetings with executive...

  • Page 37
    ...executive compensation, and retirement and severance benefits are all within the purview of this committee. Matters considered and reported by this committee are deliberated on before a decision is made by the CEO and President, the Board of Directors, the Board of Corporate Auditors, or the General...

  • Page 38
    ... our lineup of ECOPIA tires, pursue global development, and promote their use as original equipment. Furthermore, as a new business model utilizing retread tires, we are developing Eco Value Pack, which contributes to environmental conservation through reduced resource consumption, energy usage...

  • Page 39
    ... for this promising product. Bandag Retread Factory: To promote Eco Value Pack, Bridgestone plans to open about 20 Bandag Retread Factory locations in Japan over the next few years. A New Testing and Development Center in Yokohama Plant: This facility focuses on experimental performance tests in...

  • Page 40
    ... at the Europe Grand Prix. Also, in the MotoGP World Championship, the premier class of motorcycle road racing, a rider on Bridgestone tires clinched the 2008 title at the Motegi Grand Prix. Meanwhile, our long involvement in motorsports provided the impetus to launch the "MAKE CARS GREEN" campaign...

  • Page 41
    ... sale of tires Bridgestone Australia Ltd. Bridgestone Earthmover Tyres Pty. Ltd. Belgium Bridgestone Europe NV/SA Bridgestone Aircraft Tire (Europe) S.A. Brazil Bridgestone do Brasil Industria e Comercio Ltda. (Formerly Bridgestone Firestone do Brasil Industria e Comercio Ltda.) Canada Chile...

  • Page 42
    ... Sp. zo.o. Russia Singapore Bridgestone C.I.S. LLC Bridgestone Singapore Pte Ltd Bridgestone Asia Pacific Pte. Ltd. South Africa Spain Taiwan Thailand Bridgestone South Africa Holdings (Pty) Ltd. Bridgestone Hispania S.A. Bridgestone Taiwan Co., Ltd. Thai Bridgestone Co., Ltd. Bridgestone Tire...

  • Page 43
    ... Technical Centers Bridgestone Corporation: Tokyo and Yokohama, Japan Bridgestone Americas: Akron, Ohio, United States Bridgestone Europe: Rome, Italy Common Stock Traded Tokyo, Nagoya, Osaka, Fukuoka Common Stock Price Range (Tokyo Stock Exchange) FY 2002 2003 2004 2005 2006 2007 2008...

  • Page 44
    Bridgestone Corporation 10-1, Kyobashi 1-chome, Chuo-ku, Tokyo 104-8340, Japan www.bridgestone.co.jp Printed in Japan with soy-based ink using waterless printing on FSC certified paper from well-managed forests and other controlled sources. April 2009